11/27/2006

Inconsistency

This is not a personal attack on anybody.

It seems to me that a lot of people say that they are willing to pay more in taxes in order to help poor people, but when the government lowers their taxes, not only do they gladly accept the lowering of their taxes, they do not give any more money to people in need. I saw this a lot with my parents friends. As far as I can tell this is the only argument I know of that makes me wonder at the necessity of government programs to aid poor people.

8 comments:

scarlet panda said...

Most people are willing to do their part, but only as long as they know everyone else is also going to do their part. I think that's a consistent position.

For example, I'd probably vote for a law requiring a $10/year tax on everyone to clean up the environment. But if it didn't pass, I probably wouldn't voluntarily send a $10 check to a cleanup fund. Why? Because (a) it's not fair that the burden should fall disproportionately on me just because I'm a sucker, and (b) I have little faith that enough people would contribute for my check to have any real positive impact on the problem.

Arfanser said...

I think that money for poor people is different from the environment for the following reasons: 1) if you save 1,000 on your taxes and you give it all to a poor person that has a huge positive impact for that person, 2) money for poor people is not about whether the burden falls equally on everyone, we all contribute to the environment problem, but not to the same extent the problem of poor people. We all contribute to it through our neglect, 3) unlike the environment, these are people and to me that means they are more deserving of our compassion than the environment.

I agree with your analogy for the bill for the environment (even though I wouldn't support it) I just dont think this is an issue that can easily be analogized to other issues.

scarlet panda said...

I agree with you that the two situations are not perfectly analogous. Your point about compassion is good, and probably explains why people voluntarily DO give far more money to the poor than to the environment.

That said, I think both reasons I mentioned above still have force in the poverty issue.

(a) Perception of unfairness: It is unfair for the burden of helping the poor to fall on a few generous people. I'm no more responsible for the plight of the poor than I am for environmental problems. Both are societal problems--if I feel like I'm taking on too much of the burden of solving them while others who are equally responsible do nothing, it feels unfair.

(b) Fear of not making a real impact: If you see the problem narrowly (e.g., person X can't afford dinner tonight) your individual contribution helps. But if you see the problem in broader terms (e.g., there's a class of people who have subpar education, live in dangerous neighborhoods, and are either homeless or a paycheck away from homelessness), your $10 alone does virtually nothing to address the problem.

Arfanser said...

To address your points:

(a) This is money that people say they are willing to give to poor people if the government collects it. Are you saying that they are unwilling cause they dont think anyone else will unless the government collects it? This seems shortsighted to me. It is far more fair for a person to get to choose to donate than to force donation. What other people do or do not do seems like a poor reason to change what you do in a situation that you claim is important to you. (Proverbial you)

(b) I never meant to say that the only effective donation has to be to an individual. There are many groups that do a huge amount to help poor people based on the smaller donations of many. These groups actually get the money out instead of all of the money going to a more politically relevant issue of the time.

I believe that if something is important to you, you follow through on it no matter what. I do not understand a person claiming something is important but not important enough for them to follow through on because other people are not doing it, unless it isnt really that important.

scarlet panda said...

In (a), yes, I am saying that some people will be unwilling to give because they don't think anyone else will. In the case of giving money to the poor, that's probably a selfish decision. In the case of the environmental cleanup hypothetical, it's probably a reasonable decision, though not a particularly noble one. (The environment is important to me, but not important enough for me to throw away money pointlessly on it while those who pollute much more do nothing.) Either way, it's a common decision, as you pointed out in your original post.

Given that people have these attitudes, the only way to pay for things we think are important are to (1) let the voluntary do-gooders handle it, or (2) make everyone pay for their fair share of the problems they help cause. There are two problems with (1): it's unfair (why should the whole burden fall on the do-gooders?), and it usually doesn't produce enough money to solve the problems.

Arfanser said...

I think that people dont give money now because they think that what they give in taxes is sufficient. They think that because the government squanders their money, that other organizations that help poor people will also squander their money. I think that if we cut all government aid programs of that nature, people could not justify to themselves that since they pay their taxes they are doing their part. Then they will feel that they are part of the problem, and greater pressure to be part of the solution. I think that if you cut all government spending for poor people you would actually see an increase in charitable giving.

Fishfrog said...

"I think that if you cut all government spending for poor people you would actually see an increase in charitable giving."

Not only is there no empirical evidence to support this claim, but there is actually evidence to support a contrary position. As I have coommented on your blog before, the only thing that consistently increases charitable giving is increasing the deductibility of the contributions against taxable income.

A cut in all government spending on the poor would likely have no impact on the overall level of charitable giving. A cut in welfare would have to be tied to an increase in the tax incentive for the contribution.

On SP's point A. The problem she is bringing up is systemic. It is one of the primary motivations for almost every government program, from regulation of securities to environmental policy to highway construction. I just don't think it's debatable that "the free rider" problem is relevant to the need for government action in this case.

Arfanser said...

Maybe you can enlighten me. I know that the "freerider problem" is cited as the reson for doing a lot of governmental action. But when have we put it to the test? When have we told people to take care of it themselves and left the government out of it?

As for the other point. I never said that imperical research supported my assertion that charitible giving would go up if government butted out of the charity business, I just said I thought it would.

Finally, like I said last time. I am fine with huge tax breaks for charitble giving.